Outcry over Irish Water as consultancy fees send money down the drain

CEO of Irish Water John Tierney arrives at Leinster House for a hearing after admitting that the company spent 50 million euro on consultancy fees.Laura Hutton/Photocall Ireland

There's a saying in Ireland that it never rains but it pours.

With the country’s first national water authority, the semi-state Irish Water, only into its third week of establishing a system to provide clean water to businesses and homes for a fee, the criticism is not just pouring on its bosses and government politicians.

They are being practically deluged with anger after it was revealed last week that of the first €100 million ($136m) supplied to set up the authority, €50 million ($68m) has already been spent on “consultancy” fees, but nobody knows who got the money or for what.

Two days this week have been set aside for Irish Water executives to face questioning from politicians about how they spent €50 million in consultancy fees.

Two separate parliamentary committees – The Joint Committee on Environment, Culture and Gaeltacht and the Public Accounts Committee – are seeking answers in separate sessions.

Irish Water was set up by Environment Minister Phil Hogan in 2012, under the stewardship of Bord Gais (the Gas Board), to devise a national system for clean water through an updated piping and metering system. Homes are expected to pay an average €300 ($400) a year water bills from next year.

Although set up in 2012, with government expectations that Irish Water would be established with the use of Bord Gais's skills in customer relations, network management and metering and utility operation, it only became a legal entity in its own right from January 1 this year.

Shortly afterwards anger exploded throughout the nation when Irish Water chief executive John Tierney was asked last week on RTE Radio by Sean O’Rourke about the costs of setting up the utility.

It was a question many politicians said they had asked previously without receiving adequate answers.

Tierney told O’Rourke that €50 million had already been spent on consultancy fees.

Hogan and Junior Minister for Natural Resources Fergus O’Dowd each said they did not know €50 million was spent on consultancy fees.

Now watchdog committees are seeking to find out how the money was spent and which companies it went to.

Tierney is also expected to give the committees some comparison of what was spent on comparable projects in Ireland and overseas.

Social Protection Minister Joan Burton has spoken of the need for a full explanation showing that taxpayers got value for money. She warned against Irish Water becoming “a gold-plated operation.”

CEO of Irish Water John Tierney arrives at Leinster House for a hearing after admitting that the company spent 50 million euro on consultancy fees.Laura Hutton/Photocall Ireland